The US Federal Reserve began its deliberations for the latest monetary policy decisions today, December 17, and will announce its new benchmark interest rate decision on Wednesday, December 18. The US central bank will conduct its two-day Federal Open Market Committee (FOMC) meeting amid analysts’ expectations of another quarter-point rate cut for the second straight time.
Wall Street analysts widely expect the US Fed chair Jerome Powell-led rate-setting panel to reduce the benchmark policy rate again after delivering its first rate cut since 2020 in September 2024. The new US federal fund rate currently sits at 4.50 per cent—4.75 per cent after the central bank slashed its benchmark rate by 25 basis points (bps) during the November policy verdict.
“Widespread pessimism prevails across all sectors ahead of key policy decisions from the US Fed, BoJ, and BoE. While the market has already factored in a 25 bps cut from the US Fed, it remains vigilant for any hawkish signals,” said Vinod Nair, Head of Research, Geojit Financial Services. Bank of England (BoE) and Bank of Japan (BoJ) will also unveil interest rate decisions this week.
US Fed rate cut trend
In September, the US Fed kicked off its monetary policy easing cycle and voted 11 to 1 to lower the federal funds rate after holding it at over a two-decade high for over a year. It was the…